Bank of China lists pioneering Green Bond programme in Luxembourg
On July 13, 2016, the Luxembourg Stock Exchange (LuxSE) listed, and admitted to trading on its Euro MTF market, four green bonds issued by Bank of China (BoC). With a total issue amount of $2.8 Bn, it is the first green bond issued by a Chinese financial institution in continental Europe.
The bonds were issued by BoC under its US$20,000,000,000 Medium Term Note Programme. Proceeds raised from the issuance of these green bonds will be used to finance projects that will promote renewable energy, pollution prevention, clean transportation and sustainable water management.
The choice of the Luxembourg Stock Exchange as a listing place reflects the commitment of the Bank of China Group towards Luxembourg and further strengthens the Grand Duchy’s role as a leading global hub for climate finance. Indeed, the world’s first Green Bond was listed in Luxembourg in 2007 and the LuxSE today has a market share of over 50% of global Green Bond listings. Luxembourg is, moreover the European domicile of choice for climate funds, with a market share of 69% of assets under management in renewable energy funds in Europe.
"As a leading financial centre in the heart of Europe with a global outlook and well established market expertise, Luxembourg plays a pivotal role in the funding of green entrepreneurship, supporting the growing market for green bonds and ensuring appropriate transparency”, said Luxembourg Finance Minister, Pierre Gramegna.
With more than 110 green bonds listed in 14 currencies, LuxSE is dedicated to the development of Green Finance while promoting the evolution of the Green Bond market in line with industry best practices.
In 2014, BoC already listed its “Schengen” bond on the Luxembourg Stock Exchange, becoming the first Chinese financial institution to list an offshore Renminbi Bond in the Eurozone. Continuing its Schengen Bond series, BoC today sets a new standard for the global Green Bond market, becoming the first bank to list multiple Green Bond tranches simultaneously under a single programme.
"The "Green Schengen Bond" is an excellent demonstration of Bank of China’s determination to promote the green bond market development in Europe through its Luxembourg branch and our bank’s strong wish to continuously support Luxembourg in it’s strive to remain the leading Green Bond listing centre", said Mrs. Zhou Lihong, CEO at Bank of China. Bank of China chose Luxembourg in 1979 to set up its very first international presence since the foundation of the People's Republic. Luxembourg today acts as the continental European hub for the 6 largest Chinese banks.